Character Technologies - Chapter 11 Case Summary

Business Description

Headquartered in California's Silicon Valley, Character Technologies, Inc. d/b/a Character.AI ("Character" or the "Debtor") operates Character.AI, an artificial intelligence ("AI") entertainment platform where users interact with fictional or imagined AI characters through conversation, generated images and video, and audio. Character filed for Chapter 11 in the District of Delaware on October 12, 2026 (the "Petition Date").

Anyone of an appropriate age with an internet browser and an email address can use the platform, and its application is distributed through the Google and Apple App Stores. Character serves approximately 12 million monthly active users around the world, who on average spend approximately 120 minutes a day on the platform.

Character earns revenue primarily from subscriptions and in-app advertising. Total revenue grew from approximately $7.4 million in fiscal 2024 to approximately $23.6 million in fiscal 2025. Monthly revenue rose from approximately $2.8 million in December 2025 to approximately $5.3 million in August 2026. As of August 2026, however, Character was running an operating loss of approximately $8 million to $9 million per month.

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Corporate History

Character was founded in 2021 by AI researchers who left Google LLC ("Google") to develop chatbots based on their work with "transformer" artificial neural network architecture. In 2022 it launched its platform, built on large language model ("LLM") technology, to the public. Character is privately held, and as of the Petition Date its equity holders are all individuals who are current or former directors or employees of Character.

The 2024 Google Transaction

In mid-2024, Character received an offer from Google for a strategic transaction. After negotiations, the deal was structured so that, in exchange for approximately $2.7 billion in total consideration, Google rehired Character's founders, and Character granted Google a non-exclusive license to its technology as it existed at the time and released certain claims it may have had against Google and certain other parties (the "2024 Transaction").

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Operations Overview

Product and Safety Systems

Since the 2024 Transaction, Character has developed:

• proprietary video AI technology that turns a single uploaded still image into a figure that speaks, sings and emotes;
• an autoregressive diffusion model for real-time, audio-driven, FaceTime-style video generation with fictional characters; and
• a training framework for supervised fine-tuning of large-scale LLMs using open-source models.

It has also launched new chat styles and a chat feature that mimics texting conversations.

A large focus since the 2024 Transaction has been safety and oversight technology. This includes tools that infer users' ages from their conversations, detect long-term patterns of potential harm, and classify different safety risks through continuously monitored safety classifiers. In November 2024, Character deployed a separate model for users under 18 with additional safety controls, character and content filtering updates, "time spent" notifications and a parental insights tool. Beginning in October 2025, Character spent several months phasing in restrictions designed to reduce and eventually eliminate open-ended chatting by users under 18. It has since banned users under 18 from open-ended chats with its characters.

Revenue Streams

Monthly subscription revenue grew from approximately $0.6 million in January 2024 to $2.8 million in August 2026, which Character attributes to increased marketing and other efforts. Character launched in-app advertising in mid-2025 through multiple advertising networks. In March 2026 it entered into an amended programmatic revenue-share and incentive arrangement with a leading online advertising provider. Monthly advertising revenue grew from approximately $0.5 million in July 2025, its first full month, to approximately $2.5 million in August 2026. Character introduced in-app purchases in early 2026.

Workforce

Character's September 30, 2026 payroll of approximately $995,000 covered 86 full-time employees. Before the Petition Date, 66 of those employees were offered, and accepted, employment with Disney Worldwide Services, Inc. ("Disney") as part of the proposed Disney transaction (the "Transferring Employees"). Of those, 56 have formally resigned. The remaining ten hold H-1B, TN or F-1 visas and continue to provide services to Character while the U.S. government updates their work visas. Character expects the Transferring Employees to resign shortly after the Petition Date.

As of the Petition Date, Character has 18 active full-time employees, eight of whom are expected to remain through key portions of the case. The next payroll for the 18, covering the period ending October 15, 2026, was funded prepetition.

Character supplements its employees with independent contractors in areas such as product engineering, safety moderation, data science and security engineering. It also uses temporary workers, including college interns and staff placed through approximately six staffing agencies for finance, accounting, legal, technology and administrative support. The workforce oversees the platform's safety functions, which require daily monitoring. Over the years, Character's employees have been subject to threats of violence, and Character employs physical security in response.

Vendors, Utilities and Insurance

A limited number of vendors (the "Critical Vendors") provide Character's computing hardware and infrastructure, cloud space and storage for its platform and data, and platform monitoring and safety services. Character describes these services as generally proprietary or so integrated into its business that they cannot easily be replicated or replaced. It says that losing them would put at risk the data, code and intellectual property that make up its entire business.

Character obtains internet, electricity, telecommunications and similar services through approximately three utility accounts. It paid approximately $15,000 a month on average over the twelve months ended August 31, 2026. It maintains approximately 20 insurance policies, including directors' and officers', media, technology and cyber, employment practices and fiduciary liability coverage. Most were placed through Arthur J. Gallagher & Co. and its subsidiary Woodruff-Sawyer & Co.

Cash Management

Character's finance department oversees an integrated system of bank accounts (the "Cash Management System") on a daily basis. The accounts are held at Silicon Valley Bank, a division of First-Citizens Bank & Trust Company ("SVB"), Morgan Stanley and JPMorgan Chase Bank, N.A.

• Receipts Account — receives subscription revenue from Stripe, Inc. and periodically transfers it to the Main Operating Account.
• Main Operating Account — receives app revenue from application providers such as the Google and Apple App Stores, advertising revenue by ACH, and insurance reimbursements for certain legal settlements. It funds payables, payroll and all other outbound payments, and is swept daily into the Cash Sweep and TAS Interest Bearing Accounts.
• Cash Sweep Account — invests across four treasury and government money market funds, reinvesting dividends. It returns funds to the Main Operating Account one business day after they are called.
• TAS Interest Bearing Account — receives 5% of the daily swept funds and holds them uninvested as a same-day buffer for the Cash Sweep Account.
• Investment Account — invests in treasuries, commercial paper and money market funds. Funds move by manual wire to the Main Operating Account as needed, usually once a month.

Character also uses approximately six physical corporate cards, plus virtual cards, issued through Ramp Business Corporation. The cards are used primarily for recurring subscription charges from some of its largest and most critical vendors, and for employee travel and expenses. Card spend historically ran approximately $1 million a month, mostly vendor payments. Character expects it to fall significantly given its reduced workforce and operating-expense cuts.

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Prepetition Obligations

Character has no funded debt. The declaration of Chief Executive Officer Colin M. Adams in support of the first-day pleadings (the "First Day Declaration") identifies its primary potential liabilities as claims of litigants, regulators, trade vendors and service providers.

Unrestricted cash, cash equivalents and investments totaled approximately $57 million as of the Petition Date. The Cash Management System held approximately $59.4 million across seven bank accounts on that date, a total that includes a $2 million refundable deposit the Debtor holds in connection with the proposed sale process.

On the trade side, the First Day Declaration states that Character's liquidity challenges and the uncertain future of its business have significantly hindered timely payment to many Critical Vendors. It says this has strained those relationships and threatens Character's go-forward dealings with them.

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Events Leading to Bankruptcy

The First Day Declaration attributes the filing to declining liquidity and high costs, both from operating the business and from defending lawsuits and regulatory investigations relating largely to the safety of Character's products.

Cost Structure and Cash Burn

According to the First Day Declaration, Character has struggled with profitability at all times. Its costs are driven primarily by computing infrastructure and the need to retain in-demand AI talent, and age restrictions, harm detection and significant legal costs have added to them.

• In the second half of 2024, following the 2024 Transaction, operating expenses excluding legal fees averaged approximately $21.9 million per month, including approximately $13.8 million of monthly compute costs.
• In fiscal 2025 they averaged approximately $18.5 million per month, including approximately $10 million of monthly compute.
• From January 1 through August 31, 2026, Character spent approximately $56.1 million on compute, about 45% of operating expenses. Most of it went to graphics processing unit ("GPU") capacity contracted from third-party cloud providers. Personnel cost approximately $19.7 million, about 16% of operating expenses.

To reduce its burn, Character moved inference workloads to lower-cost GPU capacity and shifted to post-training open-weight models rather than developing proprietary foundation models. It also reduced headcount and consolidated facilities. By August 2026, operating expenses excluding legal fees had fallen to approximately $13.3 million. That is approximately 39% below the second-half 2024 monthly average and approximately 28% below the 2025 average. Net cash burn had fallen to approximately $8.2 million per month, compared with monthly averages of approximately $21.5 million in the second half of 2024 and approximately $17.6 million in 2025. Cash on hand nonetheless continued to decline.

Personal Injury Litigation

Since 2024, Character has faced personal injury lawsuits for negligence and strict product liability tied to safety issues arising from minors' alleged use of Character.AI, including suits stemming from allegations of youth suicide and self-harm. In January 2026, Character and the plaintiffs reached a comprehensive settlement of all claims in the then-filed personal injury lawsuits. In August 2026, a new complaint alleging harm to a minor from Character's products was filed in the Northern District of California. It is now the only outstanding personal injury suit against Character.

U.S. Regulatory Investigations and Litigation

Character faces the following domestic proceedings:

• Multistate Group — In November 2025, Character was informed that the attorneys general of several states were investigating it. The group formed after separate, parallel state investigations were already underway, and other states and territories later joined, for a total of 46 (the "Multistate Group"). The states' civil investigative demand asserted cause to believe Character had engaged in, or may be engaging in, acts that could trigger liability under state consumer protection and other privacy statutes. An executive committee of seven states negotiates for the group. Character and that committee are in active settlement negotiations over a consent order that would resolve the group's investigations and claims, and Character hopes to reach a consensual resolution during the Chapter 11 case.
• Kentucky — After a civil investigative demand dated March 26, 2025 under the Kentucky Consumer Protection Act, Kentucky sued Character and its co-founders in Franklin Circuit Court on January 8, 2026. The case is at the motion-to-dismiss stage, and the parties remain in settlement negotiations.
• Pennsylvania — On May 1, 2026, the Pennsylvania Department of State, on behalf of the State Board of Medicine, sued Character in the Commonwealth Court of Pennsylvania. It alleges the unlawful practice of medicine through Character.AI chatbots that allegedly held themselves out as licensed medical doctors. Character's responsive pleading deadline has been extended to November 2, 2026 while the parties discuss settlement.
• Florida — The Florida attorney general issued a subpoena dated June 11, 2025 about Character.AI and Character's business practices. Florida has not joined the Multistate Group. Its investigation remains open, and the parties are in settlement negotiations.
• New Mexico — The New Mexico attorney general issued a civil investigative demand dated February 18, 2025, stating cause to believe Character engaged in unfair, deceptive and/or unconscionable trade practices under the New Mexico Unfair Practices Act. The investigation remains open.
• Texas — Two civil investigative demands remain open. The first, dated December 31, 2024, concerns possible violations of the Texas Data Privacy and Security Act and the Securing Children Online Through Parental Empowerment Act relating to minors' use of Character.AI. The second, dated August 19, 2025, concerns alleged misleading and false assertions by Character and its chatbots about medical licensure, academic credentials, patient confidentiality and privacy.
• FTC — The Federal Trade Commission (the "FTC") issued a civil investigative demand dated January 15, 2025. It examined possible unfair or deceptive practices, including risks of harm and the collection of data from minors, under Section 5 of the FTC Act and the Children's Online Privacy Protection Act and Rule, and whether seeking monetary relief was in the public interest. The FTC paused that investigation on or about August 26, 2025. On September 10, 2025, it issued a Section 6(b) order for special reports on AI chatbots, and Character made its last production in response on July 31, 2026.
• U.S. Senate — Character has received various Senate inquiries, largely letters focused on the safety of its products and of AI generally, and states that it has responded to each.

Foreign Regulators

• United Kingdom — The UK Information Commissioner's Office (the "UK ICO") opened an investigation on or about September 3, 2024, and Character responded on November 14, 2024. The UK ICO sent a letter on May 9, 2025 regarding compliance with the Privacy and Electronic Communications Regulations 2003 and the UK GDPR, and Character responded on June 5, 2025. The UK ICO opened an investigation on July 23, 2025 and closed it on August 28, 2025. Separately, the UK Medicines and Healthcare products Regulatory Agency opened an investigation into Character's "psychologist" products on November 27, 2025, and Character's latest correspondence with it was on May 6, 2026. On September 25, 2026, the UK ICO opened a new investigation into Character's use of personal information and whether it creates risks of harm for users, including manipulation, reduced autonomy and excessive or unfair data processing.
• Italy — On or about November 8, 2024, the Italian Data Protection Authority (Garante) opened an investigation into Character's GDPR compliance, which also covered product safety and age assurance. Its final order on July 3, 2026 mandated corrective measures and imposed a €79,000 fine, which Character paid on August 31, 2026.
• Australia — On October 16, 2025, the eSafety Commissioner issued a non-periodic reporting notice about Character's compliance with the Basic Online Safety Expectations under the Online Safety Act. It published its findings on the responses of Character and other AI companies in March 2026.
• Russia — Roskomnadzor ("RKN") issued a take-down notice regarding prohibited LGBTQ+ content on or about January 20, 2026, followed by statements of administrative offenses on February 19 and March 2, 2026. On May 21, 2026, the Tagansky District Court of Moscow published rulings fining Character RUB 3.5 million (approximately $47,000) and RUB 4 million (approximately $53,000). On or about May 29, 2026, RKN issued a further statement of offense over alleged drug propaganda. On August 12, 2026, the same court found Character liable and imposed a fine of RUB 1.25 million (approximately $15,000).

Failed Capital Raise and Marketing Process

Character was unable to raise new investment capital or otherwise monetize the business, which the First Day Declaration attributes to Character's potential liabilities and the current regulatory environment. More than a year before the Petition Date, Character began searching for strategic and financial acquirers or partners. In August 2025, it engaged an investment bank (the "Prior Banker") to pursue strategic and financing alternatives in parallel.

The Prior Banker approached approximately 28 potential parties, largely strategic buyers and potential investors. According to the First Day Declaration, the feedback was consistent: Character's product and user base were impressive, but the litigation and regulatory overhang was too great. The outreach produced only one proposal, which was ultimately deemed unworkable. The strategic process continued in consultation with the Prior Banker while Character pursued strategic partners and operational changes, and the Prior Banker's engagement ended in late August 2026.

Talent Attrition

The First Day Declaration describes AI talent as expensive to retain, with frequent bonuses and the prospect of large equity upside standard at AI start-ups. It states that keeping key personnel became increasingly difficult as Character's cash position deteriorated and employees began questioning its long-term viability. By September 2026, Character was experiencing mounting attrition and declining morale. Management was deeply concerned that employees would leave en masse, which would make the platform unstable and unsafe. Character had significant concerns that, without a stabilizing solution, it might need to liquidate on an expedited basis.

Selection of Disney

By September 2026, Character was in discussions with two parties that had approached management directly about a strategic transaction. Character was acting through a special transaction committee of independent directors of its board of directors (the "Board") that had been delegated authority to advise the Board on a strategic transaction (the "Initial Transaction Committee"). After rounds of negotiations with both parties and multiple committee meetings, the Initial Transaction Committee judged Disney's proposal superior. Its review weighed value, actionability, Character's ability to operate the platform safely after a transaction, the path to further value, and the overall benefit to stakeholders.

According to the First Day Declaration, Disney agreed to structure the deal in two interrelated stages. That gave Character an immediate capital infusion under an exclusivity and prepayment letter agreement (the "EPA") and let it cut personnel costs quickly by moving employees to Disney. Character kept access to key employees through transition services provided by Disney under a Transition Services Agreement (the "TSA") to help run the platform safely for a limited period. The Initial Transaction Committee recommended final approval of the EPA and TSA to the Board, and Character signed on September 18, 2026.

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Chapter 11 Filing

Character intends to use the Chapter 11 case as a forum to negotiate a consensual resolution with the Multistate Group, personal injury claimants and other creditor groups, bringing all creditors into a single forum for global negotiations while maximizing the value of its assets. The first step is a sale process run by Houlihan Lokey, anchored by Disney as stalking horse and building on the earlier marketing by the Prior Banker and Character. Character hopes the process produces a higher, better or additional proposal that would let the Character.AI platform continue operating; if no such bid is available, the platform will be wound down. The Debtor is likely to wind down its operations after a sale of all or part of its assets. The second step would be a mechanism for the Debtor to propose a Chapter 11 plan of liquidation quickly, so the estate can make distributions to creditors in the near term.

The First Day Declaration describes the estate as a classic "melting ice cube": a mostly static pool of cash reduced by the costs of operating in Chapter 11 and prosecuting the case. Its scenario modeling assumes a sale on the Debtor's proposed timeline and a case without contentious litigation. On those assumptions, it shows the Debtor able to pay administrative claims as they come due and able to reasonably expect a positive cash balance at the end of the first quarter of 2027.

Governance

On October 1, 2026, Christopher Sontchi was appointed to the Board as an independent director. The Board then formed a special committee made up solely of independent directors (the "Restructuring Committee") to oversee the rest of the sale process and the entire Chapter 11 case. As of the Petition Date, the Board includes three non-employee directors, who together make up the Restructuring Committee. One of them also sits on a conflicts committee (the "Special Director"). The Special Director receives $60,000 per month, paid in advance, and the other directors receive cash payments of $87,500 per quarter. Adams, who signed the First Day Declaration as CEO, is also a Senior Managing Director at Areté Partners, Character's proposed financial advisor.

The Disney EPA

Under the EPA, Character and Disney agreed on a term sheet for a comprehensive transaction under which, among other things:

• Disney agreed to hire the majority of Character's workforce, including its chief executive officer, up front and before the Petition Date. Certain employees remain available through the TSA to assist with Character's operations, sale process and wind-down;
• Character agreed to release Disney and the transferring employees from certain matters;
• Disney agreed to pay $7.5 million of the $20 million cash consideration up front, before the Petition Date. $2 million of that payment serves as a refundable good-faith deposit, which the Debtor holds; and
• Character agreed to negotiate exclusively with Disney over the subset of its assets Disney seeks to acquire (the "Disney Target Assets") from signing through the Petition Date, when the exclusivity period terminated by its terms.

According to the First Day Declaration, the EPA release and the exclusivity period were critical to Disney's agreement to serve as stalking horse, and the capital infusion and workforce benefits from Disney's accommodations have already been provided. Character's chief executive officer at the time, an insider, was among the employees Disney hired. Disney did so with the Debtor's consent, given through the Initial Transaction Committee. The First Day Declaration states that:

• Disney shares no directors or controlling equity holders with the Debtor and does not control it in any respect;
• the Initial Transaction Committee and the Restructuring Committee, made up solely of independent directors, led the Disney transaction and recommended it to the Board; and
• no former insider has had meaningful input on substantial matters in the case or the sale process.

Stalking Horse Transaction Agreement

Character and Disney then negotiated and entered into a stalking horse agreement covering the Disney Target Assets (the "Stalking Horse Transaction Agreement"), along with an amended version of the TSA. The Stalking Horse Transaction Agreement provides, among other things, for a perpetual, worldwide, non-exclusive license to certain of Character's intellectual property and related technology, and a release, waiver and covenant-not-to-sue agreement. The transaction documents contemplate that the deal will be subject to a competitive process and implemented under section 363, free and clear of all claims (including successor liability), liabilities, interests and encumbrances.

The Stalking Horse Transaction Agreement would serve as the baseline bid, subject to higher or otherwise better bids for the Disney Target Assets. It includes bid protections, among them a break-up fee (the "Bid Protections"). The First Day Declaration describes these as an integral component of the agreement and a necessary inducement for Disney to act as stalking horse, and says they were negotiated at arm's length. The agreement's sale-process milestones, negotiated between Character and Disney, require a fast timeline and are contingent on the sale closing on or before December 17, 2026.

Bidding Procedures and Timing

Character's bidding procedures motion (the "Bidding Procedures Motion") seeks approval of procedures to govern the marketing and sale of all or substantially all of Character's assets (the "Assets"). The procedures would let Character designate additional stalking horse purchasers for all or any subset of the Assets and offer them the Bid Protections. A competitive auction would be held where multiple bids are submitted for overlapping Assets.

Character has also filed a motion to shorten notice by one week, asking the court to hear the Bidding Procedures Motion within two weeks of the Petition Date. It cites three reasons:

• its monthly burn;
• the risk of meaningful depletion of its cash reserves, which are all the funds other than sale proceeds that it has to complete the case and make creditor distributions; and
• the Stalking Horse Transaction Agreement's milestones.

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First Day Motions

• Wages — Authority to pay prepetition employee obligations estimated at approximately $1.8 million, of which approximately $1.4 million comes due in the interim period, and to continue employee compensation and benefits programs. The motion itemizes accrued amounts including approximately $250,000 of wages, approximately $560,000 owed to independent contractors and temporary workers, approximately $92,000 of withholdings and deductions, approximately $114,000 of accrued and unused paid time off, $99,000 of 401(k) contributions and approximately $66,000 of medical plan obligations. The Debtor does not expect any individual's claim to exceed the $17,150 statutory priority cap, except for accrued paid time off that nonbankruptcy law requires to be paid at termination.
  • Severance Program — Applies to full-time employees employed on the Petition Date and expected to stay through key periods of the case. If terminated without cause, they would receive two months of salary plus two months of COBRA premiums, with the COBRA amount paid as a lump sum at termination. The program is not expected to apply to the Transferring Employees. The two employees the Debtor identifies as likely insiders, its General Counsel and Head of People, would receive $110,000 in total (one $58,000, the other $52,000). Character paid nonmanagement employees $613,000 of severance in 2026, an average of $47,000 each. The First Day Declaration describes the insiders' $110,000 total as approximately 1.2 times that mean, although $110,000 is approximately 2.3 times $47,000.
  • Non-Insider Retention Bonus Program — Retention bonuses, earned for each month of continued employment, for approximately six trust and safety employees (program managers, specialists and technologists). The program excludes insiders and the Transferring Employees.
  • Former employee — A $58,000 severance payment plus $3,000 for COBRA under a prior severance program, for an employee terminated shortly before the Petition Date. It would be paid in the interim period if the former employee signs a release.
  • Directors — Authority to keep paying director compensation postpetition in the ordinary course.
• Cash management — Authority to continue the Cash Management System and maintain existing business forms. Also authority to honor prepetition corporate card obligations (a $10,000 balance as of the Petition Date) and bank fees and to keep paying both postpetition, plus an interim waiver of section 345(b) requirements.
• Critical vendors — Authority to pay Critical Vendor claims of up to $1.5 million on an interim basis and up to $2.5 million on a final basis. Payment may be conditioned on a written trade agreement in which the vendor either keeps supplying on trade terms no worse than those in place during the 180 days before the Petition Date or accepts a discount on its prepetition claim. If a paid vendor refuses to supply on those terms or breaches its trade agreement, the Debtor could, without further court order but on notice to the vendor, declare the agreement terminated and treat the payments as applied to outstanding postpetition obligations.
• Utilities — An $8,610 adequate assurance deposit, held in a segregated account at SVB for the duration of the case. The motion describes the deposit as approximately one-half of average monthly utility costs, net of existing deposits and other assurances, although one-half of the approximately $15,000 monthly average it reports is approximately $7,500. The motion also seeks procedures for additional assurance requests and an order barring providers from altering, refusing or discontinuing service because of prepetition amounts.
• Insurance — Authority to maintain existing insurance policies, pay obligations under them, renew, supplement, modify or purchase coverage, and continue using its brokers. Premiums have been paid in full as of the Petition Date.
• Taxes — Authority to pay prepetition taxes and fees of $190,000 on an interim basis and $230,000 on a final basis, broken out as sales and use taxes ($175,000 interim and final), income and franchise taxes ($10,000 interim; $50,000 final) and fees to tax processor Numeral Two, Inc. ($5,000 interim and final). On a final basis, the motion also seeks authority to pay any amounts assessed in two ongoing tax audits, although the Debtor does not believe any are owed. The motion separately estimates prepetition taxes and fees at no more than approximately $225,000, with $185,000 coming due before entry of the final order, figures that do not match the $230,000 and $190,000 in its itemized breakdown. The Debtor anticipates that it may receive a California income and franchise tax refund of approximately $553,473.25.
• Worldwide stay — An order restating and enforcing the worldwide automatic stay, anti-discrimination and ipso facto protections of the Bankruptcy Code, with authority to translate the related notice. The Debtor's operations routinely involve users, and occasionally governmental entities, based outside the United States.
• Redaction and notice — Authority to redact individuals' names, home addresses and emails from the creditor matrix, top-20 creditor list, equity holder list, schedules and other filings, citing identity theft and safety risks. Unredacted versions would go confidentially to the court, the Office of the United States Trustee and counsel to any statutory committee. Notice of commencement would also be posted on the claims agent's website, the Debtor's blog and its platform or community pages. The Debtor does not believe its users are creditors entitled to notice, and states that serving its approximately 163 million current and past users, even by email, would be cost-prohibitive.
• Claims agent — Retention of Stretto, Inc. as claims, noticing and solicitation agent.